The bill mandates that employers with 15 or more employees who offer paid earned time, such as vacation or paid time off, must comply with specific requirements. These include informing employees in writing about the policy on the accrual and use of earned time, providing a system for processing time-off requests and approvals, and giving employees an accounting of their used and remaining earned time. The bill clarifies that "earned time," "vacation," or "paid time off" are considered compensation and thus constitute wages due, but "sick time" or "sick days" are not considered wages due.

The bill also stipulates that employees who leave their job in good standing or are laid off must be paid for their unused earned time by the next regular pay period. If an employee's termination is due to a change in business ownership, the previous employer must pay out the unused earned time wages or transfer the unused time to the new employer. The bill is set to take effect 60 days after its passage. The fiscal note indicates that the bill could have an indeterminable fiscal impact on state expenditures, potentially up to $4.5 million, depending on how much paid leave is utilized versus paid out. The impact on county and local expenditures is also indeterminable but expected to increase to the extent that they have employees affected by this bill. The fiscal impact is not expected to occur until FY 2024.

Statutes affected:
Introduced: 275:43